INTERREG Deutschland Nederland LNG PILOTS Workshop Emden Emden

Transcription

1 INTERREG Deutschland Nederland LNG PILOTS Workshop Emden Emden

2 Agenda 1. Market and Potential 2. Price discussion 3. Infrastructure development

3 Digital transformation ordering goods at Amazon/Zalando or food online leads into a fast growing transportation sector Transport development Growth in transportation 2002 Example trucks Growth in transportation 2020 Example trucks Source: acatech DEUTSCHE AKADEMIE DER TECHNIKWISSENSCHAFTEN

4 Analyses reveal significant traffic volumes along important transport routes in LS and NRW Traffic Volumes and Transport Hubs in NRW and Lower Saxony Source: GWI

5 Over the last 5 years the number of trucks registered in the core regions in Germany increased by 15% Number of trucks in NRW and Lower Saxony in 2016 Number of trucks in thousands +15% Distribution of weight categories 10% of registered trucks are attractive for LNG LS NRW Source: Kraftfahrt-Bundesamt

6 There are six means gaining a reduction of environmental emissions in the transportation sector LNG is most promising for heavy duty traffic Alternative fuels in the transportation sector LNG-as-fuel High energy density and comparably easy handling lead to similar performances as diesel Hydrogen Low energy density and dangerous substance, but usage for energy storage possible Electric Very applicative in local and distribution traffic, but still low energy density of batteries Hybrid Application in passenger cars for urban traffic, but poor performance in commercial vehicles Bio-Diesel Less emissions than conventional diesel, but competitive to food production Efficiency increase of diesel engines Only small potential due to already high sophistication Diesel will stay an important energy source for transportation but might be substituted by various technologies

7 Economics Environment Legislation We believe LNG-as-a-fuel will open a significant natural gas market in Germany of approximately 2.5 billion until 2030 Drivers & LNG-share in the Fuel Market - Assumptions The EU 2020 climate package sets strict emission targets to member states 1/5 of all CO2-emissions from road transport Heavy duty transport almost 100% diesel based Self imposed sustainability targets from major companies Set up of green products and logistic chains Pressure on logistics companies Economic advantages of a fuel switch towards LNG due to: Great availability of LNG Increase of suppliers and markets Decoupling from oil indices 23 million tonnes of annual diesel demand of trucks in 2030 Diesel market valued at approx. 30 billion yearly We expect a 10% LNG share on the total fuel mix (~2.76 Mio tonnes) The LNG market is valued at ~ 2.5 billion / year 7

8 Taxation Regional framework National framework The Netherlands are doing well in switching into LNG-as-fuel and might be a good role model for Germany The development of the Dutch LNG market is the shining example in Europe Truck van de Toekomst Green Deal LNG Rijn en Wadden SER-Energieakkoord voor duurzame groei Milieumaatregelen Binnenvaart Zuid-Holland Duurzame Transportcorridor Betuwe (Gelderland) Logistik als Gelderse Motor Investment subsidies Fixed tax refund of 125 /1.000 kg MIA (Investment subsidy): Refund of 27% on income and corporate tax for commercial vehicles

9 Environmental Regulations Investment Incentives Taxation The German federal government has identified LNG as a potential diesel substitute and specifically promotes the market development Support measures for LNG-as-fuel 50% energy tax reduction prolonged until 2026 (decreasing from 2024) Higher competitiveness for LNG-as-fuel towards diesel 40-60% funding of additional investments for LNG trucks Infrastructure funding by the European Commission along specific network corridors Driving bans into inner-city areas in discussion due to high nitric oxide and particulate matter emissions General criticism of diesel technology (Diesel gate)

10 The number of new LNG trucks p.a. will increase slowly in the beginning, exponentially in the mid term but then reaches its cap very fast Low, Base and Growth case in LS and NRW Number of new LNG trucks p.a. LNG demand in m³ (cumulated) Low case Base case Growth case Low case Base case Growth case

11 Agenda 1. Market and Potential 2. Price discussion 3. Infrastructure development

12 LNG trucks are significantly more expensive than diesel trucks, the fuel price components are the key success factors Total cost of ownership LNG vs. Diesel* TCO of a Diesel truck [in keur] TCO of a LNG truck [in keur] Net investment Residual value Total Fuel cost Total cost AdBlue Insurance Maintenance Cost of fueling Total Net investment Residual value Total Fuel cost Total cost AdBlue Insurance Maintenance Cost of fueling Total Savings per truck: ~ EUR over amortisation period and km/a * Calculations based on infrastructure usage with approx. 10 trucks ** Including 50% investment incentive

13 The final LNG per kilogram price consists of several different cost components the delta to diesel offers margin potential beyond covering infrastructure costs LNG price composition and cost optimization towards diesel 21ct 4ct 9ct 25-30ct 90ct Infrastructure pricing at fixed rates provides economies of scale 90ct 27ct TTF Rotterdam Tax Trader Margin Terminal Fee & Transport Infrastructure Diesel Benchmark 13

14 Increasing utilization of infrastructure offers interesting profit margins on both sides, truck owners and fuel delivery Scenario calculations LNG versus diesel trucks total costs p.a. 15 Trucks 30 Trucks 15 Diesel Trucks Total Costs p.a Fuel & Infra. Trucks Fuel & Infra. Trucks Fuel Fuel & Infra. Trucks Infra. 15 LNG Trucks Total & Costs p.a. 30 Diesel Trucks Total Costs p.a Fuel & Infra. Trucks 30 LNG Trucks Total Costs p.a. Fuel & Infra. Trucks 15 Trucks: Minimum utilization rate for LNG filling station Break-even to diesel in terms of total costs per truck 30 Trucks: Increased utilization of the station leads to decreasing specific infrastructure costs Economies of scale Cost savings towards diesel 14

15 Agenda 1. Market and Potential 2. Price discussion 3. Infrastructure development

16 Germany is still underdeveloped in terms of LNG supply, but the market will catch up soon German Entry Barriers Long lasting uncertainty about prolongation of tax reduction Higher LNG prices due to longer transport routes from import terminals (Zeebrugge, Rotterdam) Low margin transport branch Affinity to German truck brands (Daimler, MAN) no vehicles yet No filling station and distribution network yet (two stations only) Many projects for building up a filling station and distribution network Foreign logistics companies interested in using German stations Source: GIE

17 A liberalisation of the small-scale LNG market would be worth striving for, similar to the electricity sector Small-scale LNG liberalisation Customer Logistics & Shipping Companies Open Access LNG Infrastr. Infrastructure Capacity Contract Gas Supplier

18 The goal is to unbundle infrastructure ownership and operation from commodity trade to the advantage of customers Advantages for Customers Diesel fuel sector characterized by blue chip oil companies and non-transparent pricing models for consumers LNG Sector LNG Supplier LNG Customer Lower investments into infrastructure Shared asset risk Outsourced downstream market development Focus on LNG sales Simplified market entrance especially for gas suppliers Price transparency Possibility to change supplier Increase of market transparency for customers (price components) Low hurdles for market entry Chance for economies of scale at increasing demand

19 Transportation costs essentially determine the profitability of small-scale LNG applications LNG transportation costs Transportation costs for LNG depend on distance from import terminal Relevant import terminals: Zeebrugge, Rotterdam, Świnoujście <15 Trucks <20 Trucks >20 Trucks >30 Trucks Greater distance means more trucks for break-even calculation towards diesel Location NRW: Approx trucks Location BaWü: Approx trucks Location Southern Germany: Approx trucks Location in Switzerland: Approx. 30 trucks Source: Stepmap New logistics solutions for LNG needed

20 By delivering LNG via inland waterways, transportation costs are reduced significantly BUT: Increasing LNG volumes necessary! Infrastructure Rollout and LNG Inland Carrier LNG-Masterplan: ARA & Inland Carrier m 3 LNG Investment: Approx. EUR 20 Mio. LNG-Containership: LNG Inland Carrier > 100 LNG ISO container Investment: Approx. EUR 10 Mio. LNG-Bunker Barge: ARA & Inland Carrier ~ m3 LNG Investment: Approx. EUR 10 Mio.